Burn
concept · strategy
The permanent removal of coins or tokens from spendable circulation, usually by destroying them or making them unspendable.
A burn removes coins or tokens from usable supply. This can happen by sending assets to a provably unspendable address, calling a token contract's burn function, or creating an output that no valid spender can redeem.
Burns are used for supply management, fee mechanisms, proof-of-burn systems, or cleanup of unwanted tokens. A burn only changes supply; it does not guarantee demand, liquidity, or price appreciation.
Coins can also become effectively burned when keys are lost, backups are destroyed, or funds are sent to an invalid or unspendable script. These losses reduce spendable supply but are usually impossible to measure precisely.
Related terms
Token
→A transferable or accountable unit defined by a blockchain protocol, smart contract, or application ledger.
blockchain · asset
Transaction Fee
→The amount paid to miners or validators for including a transaction and consuming scarce block space or execution resources.
blockchain · technical · basics